The Economics of Live Music in Leicester
by Trevor Locke
Live music lives in Leicester, as it does in most other cities and towns of the UK.
What makes Leicester stand out is its amazing and almost unparalleled wealth of musical talent contained in its bands, groups, singers and rappers.
This article discusses the business of live music in Leicester. It is difficult to say whether or not the situation in Leicester is any different from that in other English urban areas; we hope that people from other parts of the country will contribute their thoughts and experiences to this discussion, by way of comments. We in Leicester would dearly like to know what it is like elsewhere.
Many people around here have said that Leicester is unlike other cities of similar size, in the way that its music business operates. We would very much like to find out if this is the case.
Changing musical tastes
The live music scene in Leicester has been changing and over the past four years (during which time we have been actively engaged in it – maybe a tad longer) and what has struck us most is the changing patterns of musical tastes.
Four years ago, the scene here was about rock bands and rock bands. Today it is much more mixed with a wide variety of soloists, singers and acoustic artists, hip-hop acts and rappers taking centre-stage, in a way that we did not seen as much half as decade ago.
The musical tastes of the younger generation has been changing, becoming much more mixed. Whereas music fans used to divide their loyalties between indie rock, punk, pop and the various flavours of urban music, now it’s all rather more of a mash-up.
In order to stand any chance of gaining a following bands have had to respond to this by selecting a more eclectic set of influences. Bands that have any serious commitment to a future in music realise that they have to keep writing new music – often that is music that is different from what they started out with.
They also have to attract new fans and one way of doing this is to get themselves on to festival stages. One band member told me recently that his band has applied to 140 festivals in this year alone. Great idea but the chances are they will not get paid for many of their appearances.
The impact of festivals on venues
There seems to be no shortage of people who want to go to festivals. Tens of thousands will pay well over £100 or more to go to the larger national festivals for three days to see best-selling bands but would be reluctant to pay £5 to attend an evening of unknown local bands.
When fans have limited money to spend on music they have to make choices between saving up to go to festivals to see well known acts or spending their wages going to local gigs.
In the weeks before Download, Reading, Leeds or Glastonbury, ticket sales at local venues fall. In Leicester there is a local music festival pretty much every weekend from May through to October. Some of these are free one day events but the cost of festival tickets is normally higher than the £5 paid to see a line-up at a venue. It’s a case of fans having to make stark choices about how they spend their money.
The festivals business is even harder than than that for live venues, the overheads are higher and the risks are greater. When organisers plan a festival they have to book essential facilities and services months in advance.
Frequently they also have to pay up-front for those services, so the organisers are investing thousands of pounds in the hope that the event will be a success and they will recoup their outlay.
However, we all know that the weather has a habit of being bad when you least expect it; last year [2010] several festivals failed to happen because of adverse weather conditions. You cannot insure against bad weather – snow or flooding or high winds.
Despite the risks, the value of festivals is huge, with the revenues derived from on-site sales of things like food, drink and merchandise adding a lot of additional value to the revenues coming from having several thousand people captive in a field for three or four days.
Arena tours
After festivals, large-scale arenas account for a large slice of live music sales.
The PRS said, in 2011:
Although arena concerts nearly matched festivals for revenue, the
volume of events was wildly different. 2011 saw 272 festivals cater to
two million attendees, with most events lasting two or three days over a
single weekend. Arenas had to work much harder to generate the same
money – they played host to 8.5 million attendees across 1,000 events
throughout the year. Still, the busiest venue type for popular music was
the club (venues with capacity less than 1,000), with over 16,000 events
reported.
Festivals and Arenas dominate the UK’s live music market and they do so by putting on bands drafted in from the United States and Europe. Bye-gone bands make a come-back and several thousand people turn out to see them. This led one band to complain that these old-timers are keeping young rising bands out of the headline slots. Sadly, old rockers never die – they just run out of money.
For the hottest acts, the concert business is good. Lady Gaga and Justin Bieber have little problem selling tickets. Yet trouble lurks below the stratosphere. Pollstar, a research firm, estimates that the 50 biggest worldwide tours grossed $2.93 billion last year—12% less than in 2009. StubHub, a large website on which tickets are traded, says the average concert-ticket price dropped by 18% between 2008 and 2010.
Some festivals are planned five years ahead. Some of our local bands are playing in Europe; the odd thing is that they are more likely to be paid over there than they are in their home town. Musician Deven Stuart said “I know. I lived in the south of France for two years and even local cafes pay 400 euros for local bands.”
Whilst the big national events pay bands to play, this is not always the case for our local festivals. In Leicester, we do get international bands coming here to play, in our rather small-sized local venues. Music fans are however drawn to much bigger venues in Birmingham, Nottingham, Coventry and London.
Our local venues compete with festivals and arenas for the revenue of ticket sales.
Why don’t bands get paid to play?
Being in a band is often the privilege of the well-off. Earning money as a band is very hard. One of more insightful postings I saw on Facebook was a poster that read something like:
You load £5,000 of worth of kit into a car worth £500
and drive 100 miles to a gig to get paid £50
Leicester is a desert for paid gigs. Some bands are very popular and can attract 50+ fans at £5 a ticket and if they can pull that off then they stand a good chance of getting a cut out of the takings.
There are lot of opportunities for live performances for bands but hardly any of them carry a meal ticket – the risk is too great, for promoters. If you hire a band and agree in advance to pay them a flat fee the risks are that you would have to pay some or all of that fee out of your own pocket.
It’s all about the ticket sales – promoters and venues can pay bands only if there is enough money at the end of the night to share out a reasonable amount.
Recently there have been too many gigs where the bands have played to each other. That is an issue we will come back to later on. But first some background.
How many people go to gigs?
One possible explanation for this lack of performance fees is the very variable attendance at gigs – even though Leicester has a population of 329,900 and it is claimed that as many as 26 million people live within a two hour journey of the city.
That would seem to be sufficient to sustain a large audience for music. This issue was highlighted last year when the census figures were published, giving an insight in to how the ethnic population of Leicester has changed since the previous census was taken ten years before.
What makes it difficult to assess potential live music attendance, is that Leicester’s population is very plural, very ethnically mixed. Around 45% of Leicester’s population is classified (by the census) as being ‘white British.’ That brings the audience for rock music down to around 150,000, if you can agree that it is mainly white (ethnically ‘anglo-saxon’) people who support rock music. You will get some African and Caribbean people at rock gigs in Leicester but it is rare to see Indian, Chinese or even Eastern Europeans going to gigs in large numbers.
The 2011 census gives 148,629 people in Leicester describing themselves as White (UK) or 45.1% compared with England and Wales as a whole of 80.5% .
Recent debates about the underlying causes of poor attendance at rock gigs pointed to, among other things:
- Lack of publicity
- Saturation of the line-ups by bands that play too frequently
- Lack of late night public transport
One commentator wrote:
“The council could do more to promote Leicester music!”
It could but the inevitable reason for not doing this is that it would cost money – at a time when budgets for essential services are being cut. The Council would be unlikely to get much return from spending money promoting Leicester’s rock music scene – generally. it does not attract people into the city in large numbers and the live music industry does not contribute a great deal financially to the income of the Council. Venues pay rates and fees to the Council but these are not tied to attendance – venues will pay the same amounts to the Council each year, whether they are continually full or, more frequently, empty.
If anyone should do anything, it should be attracting music fans in to Leicester from other towns. So, if The Council were to spend any money on publicising live music, it should be placing adverts in Nottingham, Derby or Coventry.
That would be likely to lead to Councils in those cities wanting to advertise in a similar way to the fans of Leicester.
What might be more useful is if all the local Councils were to club together and publicise live music to the estimated two million people who live in the East Midlands travel area.
That would mean trying to switch ‘ticket-buyers’ away from other cultural and artistic interests to live music – or at least rock music (Curve has seen sell-out ticket sales for liver musical performances (such as the Rocky Horror show, The King and I or Chicago) and a lot of those tickets were purchased by people outside of Leicester.) In 2014, Live National estimate they will see 35,000 tickets for a festival on Victoria Park headlined by Kasabian.
Some have argued that the support from the local newspapers and radio stations had declined in recent years, making in harder for those not on the Internet to find out what is happening, where and when.
Leicester does not have enough live music fans to sustain its venues and hundreds of working bands. Why? There are a lot of reasons. The one that is least widely understood, is because the ethnic composition of the city is changing and the kind of people who might pay to go and see music (of the kind normally put on in music venues) is getting smaller all the time, as the proportion of the general population that likes rock music declines.
Rock music attracts only a proportion of the local population. I once estimated that the number of people living in Leicester who attend one or more rock music gigs per year was less than 5,000.
Has the local music industry caught up with this?
No. The venues are still putting on the same kind of music for the same kind of people as they always have done. The one thing that never changes about Leicester live music – is change. Venue owners and promoters are generally conservative-minded people who are slow to change. They are generally not minded to take risks or to try new things.
If live music promoters wanted to respond to the changing ethnic composition of the city they would start putting on the kind of music that people out there actually wanted to buy into: bangra, Eastern European folk music with musicians from Poland, Russia and Latvia, Bollywood, and varieties of music from the Indian sub-continent and diaspora.
Bear in mind that a proportion of bands are playing niche music – the kind of stuff that appeals to only a select minority of music fans. Bands are mostly hobbies for those that are in them. They play music, that they like, for their friends. Not many rock musicians will sit down and look at musical tastes and say “hey guys, if we want to get anywhere we need to start playing something different. “
If the cultural composition of the local population is changing, should the kind of music being offered change to reflect that?
Would people begin to appreciate the music of other ethnic and cultural traditions? Fans have become well used to reggae and ska – will they also come to like bangra and cross-over? Will people from Leicester many small communities begin to buy tickets for live music gigs, outside of their enclaves?
If the population of a city changes you would think that the kind of music made available for it would also change.
Are gigs cheap?
If you wanted a night out where would you go and how much would it cost? Relative to the price of the cinema? a night club? a play?
Would you compare ticket prices for each of these entertainment or cultural choices?
Most gigs in Leicester are set to £5 a ticket. Compared to the Cinema, The Theatre, The Clubs, this is a reasonable and competitive amount.
Over and above the cost of admission, there is travel costs and out of pocket expenses for food and drink.
What is the average price of a night out – £10, £20 per person?
What does it cost to provide a night of live music? The average ticket price for a live gig in a small venue is £5. That has not changed for many years. What has changed is the increasing overheads and consequential decline in profit margins for our live music venues.
We have also seen an increase in the number of venues that exist solely to offer live music.
It is now much more difficult to be a successful promoter and locally it is reputed that there is only one who does it as his full-time occupation. So if the promoters of gigs are not making any money out of it, it’s hardly surprising that neither are the bands who perform for them.
Both fans and band members often fail to understand the overhead costs of putting on a night in a music venue. They see a lot of drink going over the counter and think that the money made from the night comes from bar takings. This is not usually the case in music venues; even if it is, in pubs.
At nearly all of our permanent live music venues, the ticket money goes to paying the sound engineer and sometimes security staff and the over head costs of the premises (the various rates and licences) and maybe sometimes even publicity and advertising. That money comes from ticket sales.
If there is any money left over it goes to the bands but not before the house staff have been paid. Sound engineers are not cheap; they need to make a living and they run a closed shop in which hourly rates of pay are protected. There are not many of them.
Small venues frequently complain that times are hard and that attendances are dwindling. Hardly surprising – the market for rock music is going down not up, in Leicester.
We once estimated that (in a city of nearly half a million people) there were probably not more than 5,000 people who attend rock gigs once or more times a year. Divide that between the number of gigs that take place each week and you can soon see why we have a problem. In economics that is called ‘over-supply’ and it forces down prices. Too many bands wanting to play, too many gigs being provided for them, to few fans wanting to purchase tickets and ticket prices that are too low.
That is pretty much the picture as I see it.
The cost of a night out is more than just the £5 it costs to get in to most gigs. On top of that fans have to pay for transport and in a city where most bus services stop at 10 pm, that means taxis – in a city where taxi fares are eye-wateringly expensive, compared to say Nottingham or Derby.
The cost of drinks has gone up year on year and often fans will also need to buy food from local takeaways. Your evening out could end up costing between £15 and £25 – if you are abstemious. Fewer and fewer people can afford to do that more than once a week.
So why don’t the music venues lower their drinks prices? Simple. They cannot buy drink cheaply enough – they cannot buy barrels of beer in enough bulk to bring down the average price of a pint. They resort to cans and bottles which can be obtained at cut-price rates. When I look around at gigs I don’t see people drinking much. That might be because a high percentage of the audience is either under 18 or because they just can’t afford to buy booze once they have forked out for the transport costs and their entry fee.
Young people might have more pocket money to spend than those who have families to support; they might be able to go to gigs once a week but you still do not see them buying huge quantities of soft drinks. For the over 18s, who can purchase alcohol, if they remembered to bring their id, they are confronted with a limited range of beers and lagers at £3.50 a pint to as much as £3.80 per pint.
Rock music is beer-related and only one live music venue offers any choice when it comes to cheaply-prices real ales. The price of the bog-standard pint of Fosters varies a lot between venues.
Funding free-entry music through ‘wet side sales’ is usually only possible in pubs where there is a guaranteed attendance of people who habitually spend between £20 and £40 per person per night. If the ‘wet side’ has to cover the whole cost of opening, then the take would need to be between £3,000 and £5,000 in most cases.
Funding live music through ‘wet sales’ is not easy given the numbers of people attending gigs at the venues. Bear mind that, unlike popular pubs (that will sometimes put on a band or two) music venues do not come with a built-in audience.
The people who attend gigs to see bands, go there to see a specific band or line-up. None of our local music venues has a crowd that just goes there to be there.
There is a hitch, however. At least four players are involved in putting on a live-music show: an artist, a promoter, a ticket-seller and a venue. Locked in perpetual squabbles over the spoils, they find it hard to adopt more sensible pricing techniques.
An O level Economics student would know that if you reduce the price you increase demand. Do promoters and venue owners realise this? Apparently not. A gig with a £5 entry on the door will often attract 50 people (on a good night) – total revenue £250. If the door price was £3 and 150 people turned up it would secure £450. The risk is that, if still only 50 people turn up, then that nets a mere £150 and that’s probably not enough to cover all the costs and leave a reasonable amount for the bands. Reducing the ticket price does not always result in increased attendance.
Even free gigs – with no door charge – often fail to fill the house.
What attracts fans, to gigs in Leicester, is the line-up on offer – not the venue. People might once have gone to a venue because it was their favourite port of call but not these days.
There might once have been a crowd of people who went for a night of live music and went to a particular venue irrespective of what bands were playing – but those days have gone.
It’s not even about the night of the week; I have seen gigs on a Monday or Tuesday night attracting more fans than could be seen on a Friday or Saturday – if the line-up is popular enough.
Part of the problem we face in Leicester is inertia – the people who put on gigs keep doing the same old thing in the same old way. They are used to it and have always done things that way.
The only thing that does not change is reluctance to change.
It’s also interesting to see some gigs offering acoustic line-ups attracting the same size of audiences as nights with full electric bands – or bigger.
Will the live music scene change?
Will those who put on gigs change their music policy to suit the demands of an increasingly diverse ethnic mix? Will we see rock bands being replaced by bangra bands and a resurgence in the popularity of reggae, ska and dub-step? Will we see line-ups begin to reflect the cultural diversity of Leicester’s population?
In our view the answer to most of these questions is negative. The suppliers of live music are slow to change and out of touch. If you suggest to promoters that they should be enriching their musical offerings, they will come out with a raft of reasons why they cannot do that. As one promoter said to me recently “I just don’t know of any bangra bands.” (I use bangra bands only as an example.)
It is open to debate whether a multi-ethnic, multi-cultural music policy would actually attract more people to live music. Do people from our various cultural communities want to go to our live music venues? Or do they prefer to attend only the events put on by their own people, in their own localities?
Will we see rock bands writing new songs that might attract a new following of people from the Indian or Eastern European traditions? My guess is that rock bands will continue to play ‘white European music’ because that is what they are used to and most of the musicians in the bands are white Europeans, with some notable exceptions.
Will rock bands attract new audiences for their type of music from the ethnically and culturally diverse segments of Leicester’s new population?
Possibly. As people from other cultures settle in Leicester, they do (to some extent) because acclimatised to the surrounding world. Witness the changing tastes in food over the past 20 or so years. More and more people are eating foods from the Indian cuisine – the co-called ‘curries’ – and more and more young Asians prefer Pizza to what their mothers have been cooking for them.
Might the music tastes of young people in Leicester change to reflect the richer diversity of music styles? I see a lot of young people – both from African and Indian origins – at hip-hop shows but I do not see them also going to rock music gigs.
All cultures like music – there are not ethnic or cultural groups that do not have their own musical traditions.
Standing in the audience at a recent show headlined by the reggae band By The Rivers (one of Leicester’s most successful bands) I was struck by the diversity of the audience – yes most of the people in front of the stage where white Europeans but there was an ample mix of those who (on sight) would be from African and Indian cultural origins even though that proportion was less than I would have predicted, given the style of music on offer.
I do not go to enough live music shows featuring artists from the Indian musical tradition, apart from hip-hop, but when I do go to such nights I note the number of people there from non-Indian (white) backgrounds.
Some rock musicians are beginning to toy with Sitars, Tabla and other instruments and there is a huge following for the bands that feature ‘gypsy rock’ based on Eastern European traditions.
If the Leicester music scene is to change to attract new audiences from the city’s new pluralistic population, then musicians will have to think long and hard about the styles of music they are playing.
Bands might also need to have more open recruitment policies to attract musicians that are more representative of the local population.
What style of music being offered in the venues will, over the next decade, affect ticket sales?
Venue owners and promoters will either stick to what they know – the same old thing – or will realise that the market for what they are doing is going down and will decide to change course to attract new audiences.
If a more diverse and pluralistic offering of music styles is to be found in the venues, then it is possible, I would argue, that more people would go to venues (those who are not currently going them to hear what I call white-rock).
The venues themselves will have to change their ambience, drinks and snacks selections and where they advertise their gigs in order to reach out and attract this wider Leicester population.
Venue owners, promoters and bands will need to know a lot more about the musical tastes and life-styles of Leicester’s actual population and respond to them, in providing more varied gigs, more varied set-lists and the inclusion of bands, singers and artists that are not currently being seen in our venues.
The live music scene in Leicester, as we know it, is not sustainable. It is out of step and not dealing with the economic, cultural and social issues that confront it, in the 21st century.
This article is based on a previous blog article written in January 2010:
